And you can always be sure that all your other obligations are met before a dollar goes to a charity, by using a "Residuary Bequest
If IRD is transferred to an heir or trust in fulfillment of a pecuniary gift (a gift of a fixed dollar amount) as opposed to a fractional gift or a residuary bequest
, the transfer is treated as a "sale" of the benefits, causing immediate realization of income to the funding trust (the transferor).
: A charitable organization(s) receives all or a percentage of the remainder of your estate after the payment of any specific bequests and expenses.
(78) Intervening events that might render it relevant--such as invalidity of the residuary bequest
because the residuary taker predeceases the testator--appear unlikely to ameliorate the testator's expressed antagonism toward particular heirs who do survive.
EXHIBIT 2 MARITAL DEDUCTION UNDER PROPOSED REGULATIONS Example A Example B Example C Gross estate $9,000 $9,000 $9,000 Nonmarital bequest (3,000) (3,000) (3,000) Residuary bequest
6,000 6,000 6,000 Transmission expenses (400) (400) (400) Estate taxes (per Exhibit 3) (2,100) (2,589) (2,100)(*) Marital deduction $3,500 $3,011 $3,500 Amounts in Thousands * Does not reflect benefit of deduction for management expenses.
The estate tax return reported a $2.1 million charitable deduction--the amount of the residuary bequest
to the two schools.
But if the spouse predeceases the testator, causing the residuary bequest
to lapse and a partial intestacy to ensue, then the spouse can no longer play this role; under these circumstances, the testator might wish the doctrine of advancement to apply after all.
the marital (and charitable) deductions must be reduced whenever income from property comprising the residuary bequest
to the spouse (or charity) is used to satisfy administrative expenses." However, Justice Scalia declined to adopt the dollar-for-dollar reduction advanced by the IRS.
* Disclaimer of residuary bequest
resulted in disclaimant's inheritance under intestacy law.
* Residuary bequest
of over $2.1 million does not qualify for charitable deduction
D to partially fund a "true worth" formula pecuniary bequest rather than a residuary bequest
would produce essentially the same results as under the Sec.
However, the outright distribution of the obligation, as authorized under the instrument, or its distribution to the marital trust (which was expressed as a residuary bequest
), would not constitute a satisfaction of a bequest expressed in terms of a specific dollar amount.